It seems every year brands must focus more of their attention on e-commerce sales if they want to thrive. This year looks no different. Wonder Workshop, a company that makes toy robots aimed at tweens who are into coding, is focusing the majority of its attention on e-commerce sales. The decision to think of brick and mortar retailers as a secondary concern comes as many physical stores are facing difficulties. Toys R’ Us, long a staple of Christmastime present buying, filed for chapter 11 bankruptcy in September. Companies need to think differently than they have in the past about distribution. Laura Stevens reports:
In the past, brick-and-mortar retailers were the cornerstone of a brand’s holiday retail strategy. And while Wonder Workshop is selling Cue in chains such as Target Corp., Best Buy Co. and at Apple Inc. stores, Amazon will make or break the toy maker’s holiday season.
A surge in holiday shopping online has made Amazon a kingmaker. Amazon is expected to drive as much as half of all U.S. retail sales growth this year during the holidays, according to Morgan Stanley estimates. About 42 cents of every dollar spent online year-to-date went to Amazon, up from 38 cents during the holiday period a year ago, according to Slice Intelligence, which tracks a panel of more than 5 million U.S. online shoppers.
With a small product lineup, “it is tough for us to create visibility for our products in stores like Target and Best Buy,” says Vikas Gupta, co-founder and chief executive at Wonder Workshop, a 5 year-old startup based in San Mateo, Calif. The only way to do that would be to invest more in displays, and that is “very hard for a small company.”
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